Returns on Investments? Public Expenditures on Children and Child Outcomes across the Fifty U.S. States

Kristen Harknett, Princeton University
Irwin Garfinkel, Columbia University
Jay Bainbridge, Columbia University
Nancy Folbre, University of Massachusetts
Timothy Smeeding, Syracuse University

Our paper examines how public expenditures on children affect child outcomes across the fifty U.S. states. The diversity across U.S. states in public investments in children and child outcomes provides the ideal setting for comparative analysis. A cross-state analysis is particularly important since the 1996 welfare legislation transferred more autonomy to states in devising social policies. Our analytical framework borrows from cross-national studies of welfare states and child outcomes. We test the relationship between public expenditures on children (compiled from state budgets) and a wide array of indicators of child wellbeing. We explore relationships between state expenditures on children and child outcomes and consider whether this relationship is weakened when controls for state capacities and state racial and age composition are included. Our analysis disaggregates spending into areas such as health or education to determine which types of investments are most beneficial for children.